It was standing room only at an Economic Club luncheon yesterday at the Hilton Hotel, where Bay St. types eagerly awaited their guest speaker.

It was standing room only at an Economic Club luncheon yesterday at the Hilton Hotel, where Bay St. types eagerly awaited their guest speaker.

The big draw? It wasn't a former U.S. president, like Bill Clinton, or a head of government, like British Prime Minister Tony Blair, or even a corporate icon like Microsoft chairman Bill Gates.

The main attraction was British economist Sir Nicholas Stern and the topic of his speech: climate change.

How things have changed.

"Only a few years ago you would have seen climate change attract a much smaller audience than we have here today," said Clive Mather, chief executive of Shell Canada, as he introduced Sir Nicholas to hundreds of Canada's business and political elite, including Mayor David Miller, Ontario PC leader John Tory and former Ontario premier Bob Rae.

A few years ago? Try last winter.

The packed event was yet another sign that the politics of global warming and the call to action has reached a crucial tipping point. Big business is waking up, and in many ways taking more leadership on the issue than our risk-averse governments.

Stern can take some credit for that. The former chief economist for the World Bank and current economic adviser to the British government created a global stir last October with his Stern Review, a 700-page analysis that, for the first time, attempted the Herculean task of quantifying the economic cost of both fighting and doing nothing about climate change.

The cost of not acting grabbed the biggest headlines. "That I think was the shocker and the thing that put this on the map," said environmentalist David Suzuki, who along with Stern spoke earlier in the day to students at the University of Toronto.

Stern concluded in his controversial report that spending 1 per cent of gross domestic product on emission-reduction and adaptation strategies could, between now and 2050, significantly lower the risk associated with climate change.

On the other hand, if the world does nothing, there's a strong chance that global temperatures will go up by 2 to 3 degrees Celsius over the next 50 years. This could reduce GDP by 3 per cent and set the stage for global economic collapse. If temperatures go up 5 degrees, up to 10 per cent of GDP could be lost and possibly much more for the world's poorest countries.

And that's not even the worst-case scenario, which sees trillions of dollars wiped away by rising sea levels, extreme weather and crippling droughts.

"Life would have been much easier had we taken this up 20 or 25 years ago," Stern said.

"It's cheaper and more economical to treat it as an urgent issue. ... It's to postpone things now that will raise the costs."

Immediate reaction to Stern's report was mixed, with some economists calling it a mixed bag of selective assumptions. Despite his critics, his analysis has given an economic boost to an environmental cause.

Earlier in the day, at the University of Toronto's Hart House, Stern told students a 1 per cent investment of GDP every year isn't going to break the bank as some suggest, let alone cause any economic disruptions.

"It's a sum you can cope with ... it doesn't make the economy grind to a halt," said Stern, adding that investments in energy efficiency, emission-reduction technologies, renewable energy, and reforestation can be a huge economic opportunity if supported by smart policy.

Stern said he saw a key role for technologies that help sequester carbon dioxide underground for long-term storage, and considers carbon regulation – whether in the form of cap-and-trade systems or carbon taxes – as a vital economic tool for sending price signals that ultimately change the behaviour of consumers and industry.

He had harsh words for those who prefer a policy of inaction, calling those who deny the science of global warming "simply absurd" and those who want to delay action until a direct threat is evident as "reckless."

Thomas Homer-Dixon, director of the Trudeau Centre for Peace and Conflict Studies at the University of Toronto and host of the Hart House meeting, said Stern's report has altered the dialogue on global warming in the same way as Al Gore's An Inconvenient Truth documentary and the recent United Nations-backed report on climate change.

"The Stern report has been particularly influential because it speaks in the language of our most powerful decision-makers: the heads of corporations, finance ministers, the leaders of central banks and international financial institutions," said Homer-Dixon.

As Stern spoke to business people in Toronto, Alcan Inc. chief executive Dick Evans told a meeting of the Canadian Club in Montreal that an integrated scheme of regulation, standards and fiscal incentives is needed to achieve long-term emission targets.

"There needs to be a fundamental change in behaviour, embracing the economic, social and environmental benefits of addressing climate change today with real actions," he said.

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